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TMI Blog1973 (12) TMI 9X X X X Extracts X X X X X X X X Extracts X X X X ..... s the assessee's individual income - - - - - Dated:- 21-12-1973 - Judge(s) : VIMADALAL., DESAI. JUDGMENT DESAI J.-This is a reference by the Income-tax Appellate Tribunal, Bombay Bench " C ", under section 66(1) of the Indian Income-tax Act, 1922. The reference arises out of the assessment proceedings under the Indian Income-tax Act for the assessment years 1957-58 and 1958-59, the relevant account years being Samvat years 2012 and 2013. Necessary facts material for the purpose of this reference are as follows : The assessee is one Gordhandas K. Vora who is the only son of the Kishandas Vora and a grandson of one Sir Manmohandas Ramji. Sir Manmohandas had three sons, Kishandas, Narandas and Bhagwandas. During his lifetime Manmohandas gifted to his son, Kishandas, shares of several companies. Kishandas died intestate in 1930 and on his death his son Gordhandas inherited those shares ; they became ancestral property in his hands. A son was born to Gordhandas in 1953. It is the agreed position that the property that Gordhandas inherited in this manner from his father, kishandas, was ancestral property in his hands and during the material account years it belonged to the Hin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Bhagwandas and Gordhandas--partitioned the immovable property. Up to and including the assessment year 1956-57, the assessee, Gordhandas, had always filed returns in the status of an individual and had been assessed in that status in respect of his income from all the sources, viz., (i) income from shares inherited by him from his father, Kishandas, (ii) income from properties received under the settlement of 25th February, 1927, read with the amending deed of 17th March, 1930, which was subsequently partitioned amongst the three beneficiaries, and (iii) the share of the commission receivable as provided by clause 12 of the will of Sir Manmohandas. Even for the assessment year 1957-58, the assessee originally filed a return in the status of a Hindu undivided family, declaring therein income of Rs. 78,266 from the above three sources. Subsequently he filed two revised returns, one in the status of Hindu undivided family and relating to income derived from the shares that Gordhandas inherited from his father, Kishandas, and the other in the status of an individual and relating to income from the remaining two sources. It was claimed that two separate assessments should be made up ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 12 of the will is assessable for the assessment years 1957-58 and 1958-59, in the hands of the Hindu undivided family consisting of Gordhandas and his son as coparceners ? " Mr. Joshi, on behalf of the Commissioner, has referred us, in the first instance, to observations to be found at page 250 of Mulla's Hindu Law, thirteenth edition, and thereafter to the case of C. N. Arunachala Mudaliar v. A. Muruganatha Mudaliar. In Arunachala Mudaliar's case' the Supreme Court after the consideration of the texts on the subject and the variant opinions of the High Courts took the view that the question was primarily one of the intention of the donor or the testator to be gathered from the terms of the deed of gift or will. If there are no clear words describing the kind of interest intended to be given, the court would have to collect the intention from the language of the document taken along with the surrounding circumstances in accordance with the established canons of construction. The material question in such cases would be whether the grantor really wanted to make a gift of the property to his son or the apparent gift was only an integral part of the scheme to partition the same. I ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lifetime and to that extent would indicate that such income must be regarded as the son's separate income. It is important to note clause 12 of the will which pertains to the disposal of the said commission. There are no words circumscribing or limiting in any manner the right of the sons or indicating that they are to utilise the said income for the purpose of their families. In Arunachala's case the Supreme Court has observed that where there were no clear words describing the kind of interest which the donee is to take, the question would be one of construction and the court would have to collect the intention of the donor from the language of the document taken along with the surrounding circumstances. The language of the document is, to a certain extent, against the view urged by Mr. Joshi. There are no surrounding circumstances brought on the record or pointed out to us which go to the contrary. As a matter of fact, the recital at the beginning of clause 12 of the will could itself be deemed to be a surrounding circumstance which would militate against the view canvassed by Mr. Joshi. Accordingly, it must be held that these two categories of assets received by Gordhanda ..... X X X X Extracts X X X X X X X X Extracts X X X X
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